As per regulation 4 a person cannot be eligible for being appointed as an insolvency professional if, he is covered in any of the following:
(a) If he/she is a minor;
(b) If he/she is a resident outside India;
(c) If he/she is not fulfilling the requirement of Regulation 5 or Regulation 9;
(d) If a person commits any offence whose term of imprisonment exceeds six months, or if he commits an offence involving moral turpitude, and a period of five years has not elapsed from the date of expiry of the sentence;
Provided that if any person has committed an offence, whose period of imprisonment exceeds seven years or more then, he/she is not eligible for being appointed as an insolvency professional in his/her life.
(e) If he/she is an undischarged insolvent or has applied to be adjudicated as an insolvent.
(f) If he/she has been declared as a person of unsound mind by a competent court.
(g) If he/she is not a fit and proper person according to the board.
Qualifications and experience:
As per regulation 5 if any person wants to become an Insolvency professional he is required to fulfill any of the following conditions:
(a)If he/ she has passed the National Insolvency Examination;
(b) If he/she has passed the Limited Insolvency Examination, and has fifteen years of experience in management, after he received a Bachelor’s degree from a recognized university.
(c) Has passed the Limited Insolvency Examination and has ten years of experience as –
(i) A chartered accountant enrolled as a member of the Institute of Chartered Accountants of India,
(ii) A company secretary enrolled as a member of the Institute of Company Secretaries of India,
(iii) A cost accountant enrolled as a member of the Institute of Cost Accountants of India, or
(Thus, a person who is only a member of any of the above mentioned Institutes, can become an Insolvency professional)
(iv) An advocate enrolled with a Bar Council.
Procedure for registration:
As per regulation 6, person fulfilling regulations 4 and 5, are required to enroll themselves with the Insolvency Professional Agency, thereafter, he shall file an application to the Insolvency and Bankruptcy Board of India in the following manner:
(1) A person who are enrolled with the Insolvency Professional Agency may make an application for registration to the board with a fee of Rs. 10,000/-
(2) The Board shall give acknowledgement to an applicant within seven days of its receipt.
(3) If the Board requires any further information or clarification in any regard it may ask the applicant to provide the same.
Certificate of registration:
As per regulation 7 if the Board is satisfied, it may grant a Certificate of Registration to the applicant to carry on the activities of an Insolvency Professional, within sixty days of receipt of the application.
On registration, the Insolvency Professional shall abide by the code and the rules, buy-laws, regulation made thereunder.
The insolvency professional is required to Pay a fee of ten thousand rupees to the Board, every five years after the year of the grant of certificate;
The insolvency professional shall take necessary prior permission of the Board for shifting his Professional membership from one Insolvency Professional Agency to another.
Registration for a limited period:
As per regulation 9 if person comply any of the following criteria, then, there’s no need to comply the condition of regulation 5 and shall be eligible to be registered for a limited period as an Insolvency Professional-
(a) Has been ‘in practice’ for fifteen years as-
(i) A Chartered Accountant enrolled as a member of the Institute of Chartered Accountants of India,
(ii) A Company Secretary enrolled as a member of the Institute of Company Secretaries of India,
(iii) A Cost Accountant enrolled as a member of the Institute of Cost Accountants of India,
(iv) An Advocate enrolled with a Bar Council.
The registration of insolvency professionals shall be valid for a period of six months from the date of such submission.
Provided that he may complete the pending assignments undertaken before the expiry of his registration and his registration shall be deemed to be valid for this limited purpose.
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